Fintech News: August 19th, 2016

The IEX is the newest US stock exchange, and the only one that prohibits high frequency traders from ripping off retail investors. It’s launching today, and will be fully operational with all US equities within a month. The exchange is putting pressure on other exchanges to come up with their own solutions that protect retail investors.

The oldest and richest Americans need fintech solutions the most. Americans over 55, who have 70% of the country’s disposable income, are in dire need of solutions to protect their identities, credit score, and passwords.

In Silicon Valley, where the average CEO is 38 and the average employee is 30, fintech solutions are plentiful, but they all cater to millennials. Sounds like they need some elderly marketing interns to tap into the big money.

Since 2008, customers are spreading their assets across multiple financial institutions to avoid “keeping their eggs in one basket.” Data aggregation is giving rise to a plethora of third-party apps and websites where consumers can access their banking data from multiple institutions all at once. This is disrupting the traditional relationship, where the bank owns the entire customer.

Fintech has seen the most adoption in China, but why? They have a large population who skipped the desktop era and went straight to smartphones. They have a liberalized financial industry, and horribly inefficient banks. Culturally, the Chinese don’t have the same bias towards brick-and-mortar institutions, and they love cutting out the middleman. Here’s what developed markets are learning from China.